Virginia is a weird place for taxes. If you’ve just moved to Richmond or the sprawling suburbs of NoVa, you probably noticed that the Virginia individual income tax system feels a bit... frozen in time. While the federal government and many other states constantly tweak their tax brackets for inflation, Virginia hasn't adjusted its core tax pillars in decades.
It's basically a flat tax in disguise.
Even though the state technically uses a progressive system with four different tiers, you hit the top rate of 5.75% the moment your taxable income passes $17,000. Think about that for a second. In 1990, $17,000 was a decent chunk of change. In 2026? It’s barely a down payment on a used car in some parts of the state. Because that threshold hasn't moved, almost every full-time worker in the Commonwealth finds themselves paying the "rich person" rate.
Tax season in Virginia isn't just about filling out a form; it's about navigating a system that hasn't quite caught up to the modern cost of living.
How the Virginia Individual Income Tax Actually Works
Most people look at the tax table and assume they'll be doing complex math. Honestly, for most of us, it’s pretty straightforward. You start with your federal adjusted gross income (FAGI). Then you start hacking away at it with Virginia-specific subtractions and deductions.
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The rates look like this:
- 2% on the first $3,000.
- 3% on the next $2,000.
- 5% on the next $12,000.
- 5.75% on everything over $17,000.
Unless you're working a part-time job as a teenager, you’re paying 5.75%.
But here is where it gets interesting. Virginia is a "conformity" state. This means they generally follow federal tax rules, but they don't follow them perfectly. Every year, the General Assembly has to vote on "rolling conformity" to decide which new federal tax breaks they’re actually going to allow on your state return. If they don't vote on it in time, or if they decide to "decouple" from a federal rule, you might end up with a higher bill than you expected. It's a bit of a political game that happens in Richmond every spring.
The Standard Deduction vs. Itemizing
For a long time, Virginia’s standard deduction was a joke. It was so low that almost everyone tried to itemize. Recently, though, the state finally bumped those numbers up. For the 2024 and 2025 tax years, the standard deduction jumped to $8,500 for single filers and $17,000 for married couples filing jointly.
If you're a homeowner in Fairfax County with a massive mortgage, you might still want to itemize. But there’s a catch.
Virginia has a "consistency" requirement. If you took the standard deduction on your federal 1040, you generally have to take it on your Virginia 760. You can't always pick and choose the best of both worlds. This forces a lot of people into a corner where they save $500 on their federal taxes but lose $700 on their state taxes because they couldn't itemize their local property taxes or charitable donations. It pays to run the numbers both ways.
Surprising Subtractions and Credits
Virginia loves certain types of income and hates others.
If you’re a veteran, listen up. Virginia has been aggressively expanding the military retirement income subtraction. As of 2025, if you're 55 or older, you can subtract up to $40,000 of military retirement pay from your taxable income. This is a huge win for the massive veteran population in the Hampton Roads area.
Then there’s the Virginia 529 plan. This is arguably one of the best state tax perks in the country. You can deduct up to $4,000 per account, per year, for contributions made to a Virginia 529 account. And if you’re over 70? You can deduct the entire amount you contributed in a single year. No cap.
Other states are jealous of that one.
The Locality Factor
When people talk about Virginia individual income tax, they often forget that Virginia doesn't have local income taxes. If you move from Maryland or New York City, this feels like a massive pay raise. In Maryland, your county might tack on another 3% on top of the state rate. In Virginia, the 5.75% is the ceiling.
However, Virginia makes up for this with the "Car Tax."
Formally known as the Personal Property Tax, this is the bill that makes everyone in the Commonwealth want to scream every autumn. You’ll get a bill from your city or county based on the value of your vehicle. While it's not technically an "income tax," it’s a tax on your existence in the state that often catches newcomers off guard.
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Filing Status and the "Married Filing Separately" Trick
Here’s a tip that most DIY tax software gets right, but it's worth knowing why. Virginia allows a unique filing status: "Married Filing Separately on a Combined Return."
Basically, you and your spouse stay on the same piece of paper, but you calculate your taxes as if you were two single people. Why? Because of that $17,000 threshold we talked about earlier. If one spouse makes $100,000 and the other makes $80,000, filing jointly pushes almost all of that income into the 5.75% bracket. By filing separately on a combined return, you both get to take advantage of the lower 2%, 3%, and 5% brackets on the first $17,000 of each person's income.
It usually saves couples about $250 to $500 a year. It’s not a fortune, but it's better in your pocket than in Richmond's.
Age-Based Deductions
If you were born on or before January 1, 1939, you get a massive $12,000 deduction. If you’re younger than that but at least 65, you might still get a deduction based on your income level. Virginia is actually quite friendly to retirees compared to some of its neighbors, especially since Social Security benefits aren't taxed at the state level at all.
Moving In or Out?
Virginia is strict about "residency." If you spend more than 183 days in the state, you’re an "actual resident." But even if you don't, you could be a "statutory resident" or a "domiciliary resident."
If you moved to Virginia halfway through the year, you’ll file Form 760PY (Part-Year Resident). You’ll have to prorate your exemptions and deductions based on how many days you lived in the state. Don't try to hide your move date; the state checks your W-2s and home purchase records. They are surprisingly good at finding people who try to claim they moved on December 31st when they actually arrived in July.
Actionable Steps for Your Virginia Taxes
Tax planning shouldn't happen in April. It happens now.
First, check your withholding. Because the Virginia brackets don't change, but your salary (hopefully) does, you might find yourself under-withheld if you haven't looked at your VA-4 form in a few years.
Second, if you have kids or grandkids, open a Virginia 529 account. Even if you only put in $50 a month, that deduction adds up. Plus, the money grows tax-free. It’s one of the few "no-brainer" moves in the Virginia tax code.
Third, keep track of your "fixed-date conformity" news. Every February, the Virginia Department of Taxation releases a "Tax Bulletin" that explains which federal laws they are following for the year. A quick Google search for "Virginia Tax Bulletins 2026" will tell you if there are any new traps to avoid.
Finally, look at your "Credit for Taxes Paid to Another State" if you live in Virginia but work in D.C. or another neighboring state. Virginia has reciprocal agreements with Maryland, West Virginia, Kentucky, and Pennsylvania. If you work in those states, you generally only pay tax to Virginia. But if you work in D.C., you pay Virginia tax, and you don't have to file a D.C. return as long as you submit the non-residency form to your employer.
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Virginia’s tax system is predictable, which is both a blessing and a curse. It’s high for low-earners and relatively low for high-earners. Knowing these quirks—the $17,000 "top" bracket, the 529 deduction, and the married-separate filing trick—is how you stop overpaying.
Check your recent paystubs against the 5.75% rate. If the math doesn't look right, update your VA-4 with your HR department immediately to avoid a surprise bill next spring. If you're self-employed, remember that Virginia expects estimated payments on May 1, June 15, September 15, and January 15. Missing those dates can lead to interest charges that are honestly just a waste of your money.
For more specific guidance, the Virginia Department of Taxation website (tax.virginia.gov) is surprisingly user-friendly compared to most state agencies. They have a "Where’s My Refund" tool that actually works, and their lookup tables for the car tax relief program can help you estimate your local bills too.